What Exactly is an “Accidental Landlord”?

Life throws you curve balls and real estate is no exception. In essence, “Accidental Landlord” means when you buy a home to live in and then at some point you decide to rent it out instead of selling. The key here is that your original intent was always to sell, but then you decide to rent it out.

Maybe you bought a house and need to relocate.  Maybe it’s time to upsize. While accidental landlordship may come with unexpected challenges, it can also open doors to additional income and long-term investment opportunities. I should know, I was one of them in 2013.

Think about it, one of the most obvious benefits of being a landlord is the opportunity to generate a steady stream of rental income. You are quite literally building your own wealth with other people’s money (OPM).  What to do with this stream of income?  The possibilities are endless.

As your rental property continues to appreciate over time, your stream of income can increase, too.  Keep an eye on local rental market to understand typical rent prices for properties similar to yours. This will help you determine a competitive and reasonable rental rate that aligns with market trends.

Use the extra income to pay down some old debts.  Maybe you have an outstanding credit card balance, an old student loan hanging around, or a yet-to-be-paid medical bill.  Using your secondary stream of income to pay off debt and lower your debt-to-income ratio will stand to benefit you greatly across the board.

Owning rental properties comes with several tax advantages, such as being able to deduct things like property taxes, mortgage interest, insurance premiums, and even maintenance costs.

With all of this wealth being generated, you can even start to eye your next property investment.  If being a landlord to multiple properties is overwhelming to you, you can probably afford to look into hiring a property management company at this point which we have in-house.

While becoming an accidental landlord might not have been part of your original plan, it presents an opportunity to enjoy a range of financial and personal benefits. From generating rental income to building long-term wealth and gaining insights into real estate investment, being a landlord can offer you a new perspective on property ownership and a pathway to achieving your financial goals.